allAfrica.com: Mauritius: Nomad - Voice And Internet Combine in the Coming Wi-Max Business Model (Page 1 of 2)

Mauritius: Nomad - Voice And Internet Combine in the Coming Wi-Max Business Model

There are those who dream of a converged future where voice and data are combined, using significantly cheaper wireless technology. A number of those who see the future this way have bet on Wi-MAX being the technology to do it. A good many of Africa's mobile operators have taken a side bet on it to see what happens. The doubters were no doubt heartened by a very public spat in which the CEO of Australia's Buzz Broadband dropped Wi-MAX and went over to TD-CDMA. As an insurgent challenger in Mauritius to the new, vertically integrated mobile operators, Nomad, is looking to do both voice and data on Wi-MAX and wants to become a Pan-African player. Russell Southwood looks at how the dream is shaping up.

Nomad was started in 2005, taking over from Network access. Its backer is a Dubai-headquartered petroleum company called Galana which has invested "hundreds of millions of (Mauritian) rupees in the company".

It installed its first base stations in 2005, covering about 65% of the island in 2007. The plan is now to cover a further 20% of the population. Unlike the mobile networks, it does not have contiguous coverage. The first network rolled out came from Navini and the current network expansion is based on Telsima equipment. The latter is providing equipment to both Reliance and VSNL in India, two of the largest networks in the world. The two technologies work alongside each other, being used in different areas.

The company uses its Wi-MAX network for all of its national backhaul traffic. According to Nomad CEO Anil Jayant (formerly with VSNL) who has been in post for 10 months:"Wi-MAX is a great technology which works very effectively."

Like a lot of the early wireless broadband pioneers, the company has had a bad reputation for bandwidth speed. However Jayant says the issues were largely to do with network maintenance and monitoring and more effective ways of dealing with customers.:"We've spent a lot of time getting these things in place. We've put in place a strict maintenance schedule and we've replanned the network using a more standard base station methodology. It's a service assurance issue."

Nomad operates in the 2.5 ghz spectrum and according to Jayant:"This is very good spectrum and you can move to mobility on it." Nomad's future business model is only really restricted by the licensing framework. For as Jayant says:"It depends on what we are allowed." He anticipates that good Wi-MAX/GSM compatible handsets will be available in Q4 2009 and that licensing willing, they will move into offering mobile voice services.

He thinks that this newer generation of Wi-MAX/GSM handsets will meet the expectation of younger users who are already beginning to think differently about the mobile phone as a device:"For the youth, it's not a telephony-based device. It's also a camera and can be used for online chat and music. This will change the device from what it is now. The GSM handset will not cut it."

It currently has around 10,000 subscribers and is readying itself to roll out new packages aimed at different segments of its market. For example, it will soon offer a Midnight Special package for Peer-to-Peer downloaders.

Its current broadband offers are in the MR300-400 range but because it is completely reliant on incumbent Mauritius Telecom for international bandwidth through the SAFE cable. According to Jayant:"There is lots of growth potential in the hospitality and ICT sectors and connectivity requirements are escalating. But there has to be lower international bandwidth prices so needs to be a better equilibrium between price and profit. Lower bandwidth prices will help the market expand."

He believes that Mauritius Telecom (MT) is making significant profits from what he sees as over-priced bandwidth:"If I look at the SAFE consortium costs, (rates charged) should not be more than the US$00s. These guys are taking a huge profit premium from everybody." Not surprisingly, MT denies the charge and says it will be making more reductions over the next 12 months.

The company has pan-African ambitions and is looking at three countries: Madagascar, Rwanda and Tanzania. He sees a future business model based on the convergence of the mobile and broadband market:"The technology will allow you to do that and all you will need is the licence. When we enter a new country we will obtain all the necessary licences to provide voice and Internet."

But vertically integrated mobile operators Nomad is challenging are not standing still.

The second largest mobile operator Emtel (jointly owned by a local company and Millicom) was the first African company to install a 3G network and is now putting in HSDPA into several areas (like CyberCity and Port Louis) that will offer speeds of up to 1.8 mbps compared to 384 kbps on 3G.

As with Nomad, Emtel's speed problems come from its Mauritius Telecom international link. For as Roy told us:"The bottleneck remains the connection to the outside world." It has announced that it wants to buy into a second international cable if the opportunity arises. The Government is keen to see a second cable independent of Mauritius Telecom but has said the private sector must find the US$60 million to finance it.

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